Feed-In Tariff - UK Government's Clean Energy Cashback Scheme

As of April 1 2010, homeowners and communities who generate their own electricity from renewable or low carbon sources such as solar photovoltaic panels, domestic wind turbines and micro CHP boilers such as the Baxi Ecogen can receive regular payments from energy suppliers under the new Clean Energy Cashback Scheme, also known as Feed-in Tariffs (FITs).

The scheme, announced back in February by former Energy and Climate Change Secretary Ed Miliband, means any property owner with a qualifying renewable energy installation is entitled to claim payment for the electricity they produce, even if they use the energy themselves.

The benefits of the scheme are three fold. If you do qualify for the scheme you receive an initial payment for every kilowatt hour (kWh) generated (Generation tariff) and an additional payment for every kWh you export to the grid (Export tariff). And there is also an additional avoided cost benefit for usage of electricity onsite as it will reduce your bills.

The tariffs will cover anaerobic digestion, micro hydro, wind turbines and solar photovoltaic panels and aims to provide a five to eight per cent return on initial investment in Microgeneration technology. Payments will span for 20 years for solar PV and all other eligible technologies. And a number of micro-combined heat and power (Baxi Ecogen micro CHP) installations also qualify for the feed-in tariffs with payment for 10 years.

On the launch of the Clean Energy Cashback Scheme, Miliband said: “The feed-in tariff will change the way householders and communities think about their future energy needs, making the payback for investment far shorter than in the past”.

Electricity and gas regulator for the UK, Ofgem, will manage the tariff but it is up to the electricity supplier to pay for the generation tariff.

Am I eligible?

The scheme is available to those who install either:

Solar PV panels

Wind turbines

Hydroelectricity

Anaerobic digestion

Gas-powered combined heat and power (Micro-CHP) such as the Baxi Ecogen

You can only qualify for the full feed-in tariff if you had the technology installed between 15 July 2009 and 31 March 2010 or if it is installed after April 1 using a product and installer certified under the government’s Microgeneration Certificate Scheme. The rate per kWh available for the generation tariff decreases every year so the rate you begin on depends on when you join the scheme.

If you’re fitting a microgeneration system to a new-build you will receive slightly less money for the electricity you generate.

How much money could I receive?

The amount of money you can receive depends solely on the amount of electricity you generate, and how you generate it. For example, if you fit an average-sized 2.5kW photovoltaic solar panel system you will be initially paid 14.38p per kWh generated. On top of that fee you will also receive an added 4.77p for every kWh exported back to the grid. And to make it even more appealing, the income you receive is completely tax-free.

Energy Source

Scale

Generation Tariff Rate (p/kWh)[*]

Rate Duration (years)

Anaerobic digestion

≤250kW

12.46

20

Anaerobic digestion

>250kW – 500kW

11.52

20

Anaerobic digestion

> 500kW

9.49

20

Hydro

≤15 kW

21.12

20

Hydro

>15 – 100kW

19.72

20

Hydro

>100kW – 500kW

15.59

20

Hydro

>500kW – 2MW

12.18

20

Hydro

>2MW – 5MW

3.32

10

Micro-CHP[**]

<2 kW

13.24

10

Solar PV

≤4 kW new[***]

14.38

20

Solar PV

≤4 kW retrofit[***]

14.38

20

Solar PV

>4-10kW

13.03

20

Solar PV

>10 – 50kW

12.13

20

Solar PV

>50 – 150kW

10.71

20

Solar PV

>150 – 250kW

10.25

20

Solar PV

>250kW – 5MW

6.61

20

Solar PV

Standalone[***]

6.61

20

Wind

≤1.5kW

17.78

20

Wind

>1.5 – 15kW

17.78

20

Wind

>15 – 100kW

17.78

20

Wind

>100 – 500kW

14.82

20

Wind

>500kW – 1.5MW

8.04

20

Wind

>1.5MW – 5MW

3.41

20

Existing generators transferred from RO

9.9

to 2027

Export tariff (p/kWh)

All eligible technologies

4.77

Notes:
[*]: Installations registered in FIT Year 5 1st April 2014 – 31 March 2015. These tariffs are index-linked for inflation. The Energy Regulator Ofgem publishes updated tariff levels. Solar PV tariffs apply from 1 April to 30 June 2014.
[**]: This tariff is available only for 30,000 micro-CHP installations, subject to a review when 12,000 units have been installed.
[***]: These terms are defined as follows:

‘Retrofit’ means installed on a building which is already occupied

‘New Build’ means where installed on a new building before first occupation

‘Stand-alone’ means not attached to a building and not wired to provide electricity to an occupied building

How do I apply?

Once you’ve decided which technology is best suited to you and your home, you must have the installation undertaken by an MCS certified installer using MCS certified products. You can request quotes for qualifying technologies via the Renewables Guide site.

When installation is complete, your installer will register you on the central FIT database and you’ll receive a certificate confirming FIT compliance.

Once you’ve received your certificate, you must then inform your chosen energy supplier that you’re eligible to receive the tariff by using your certificate as proof which the supplier can then cross-reference with your installation through the central FIT database.

It is then up to you and the supplier to agree payment intervals – a supplier may require meter readings (like gas and electricity readings) so ensure you have an additional electricity meter fitting to measure how much electricity is being fed back into the grid.